Traverse City Record-Eagle

Business

February 12, 2014

Yellen rebuffs Fed critics pleases investors

WASHINGTON (AP) — Janet Yellen pursued a simple strategy Tuesday for handling a battery of lawmakers who came armed with skepticism about the Federal Reserve.

Politely stand your ground. Be consistent. Signal continuity at the top.

In her first public words since becoming Fed chair this month, Yellen struck a note of unity with her predecessor, Ben Bernanke, who stepped down last month. She embraced his dual outlook on the economy: It’s strengthening enough for the Fed to slightly pull back its stimulus yet still needs the help of low interest rates.

When her questioners turned aggressive, Yellen stoutly defended the Fed’s approach to the 2008 financial crisis and the recession. She rebuffed suggestions that its stimulus efforts were ill-conceived or that stricter financial rules were squelching growth.

At times, she basked in good wishes from members of the House Financial Services Committee, to which she was delivering the Fed’s twice-a-year report to Congress. Several female members offered warm congratulations to the first woman to lead the Fed in its 100 years.

“I’ve understood more of what you’ve said today than the last two (Fed leaders),” said Rep. Shelley Moore Capito, R-W.Va.

Fed leaders can make unusual witnesses at Washington hearings. Unlike many government officials, they strive to protect their political independence by avoiding confrontation. Yellen kept her guard up yet aimed not to sound combative.

She dropped no hints of how her leadership might depart from Bernanke’s. She stressed that the Fed would decide whether to continue paring its bond purchases — and eventually to raise short-term rates — based on how the economy improved. The Fed’s bond purchases are intended to keep borrowing rates low to stimulate growth.

At times, her descriptions of Fed policy and strategy mirrored Bernanke’s nearly to the word. Her key goal: Assure investors that the Bernanke-Yellen transition would be seamless.

Text Only

the BIZ
AP Video
Couple Channel Grief Into Soldiers' Retreat WWI Aviation Still Alive at Aerodrome in NY Raw: Rescuers at Taiwan Explosion Scene Raw: Woman Who Faced Death Over Faith in N.H. Clinton Before 9-11: Could Have Killed Bin Laden Netanyahu Vows to Destroy Hamas Tunnels Obama Slams Republicans Over Lawsuit House Leaders Trade Blame for Inaction Malaysian PM: Stop Fighting in Ukraine Cantor Warns of Instability, Terror in Farewell Ravens' Ray Rice: 'I Made a Huge Mistake' Florida Panther Rebound Upsets Ranchers Small Plane Crash in San Diego Parking Lot Busy Franco's Not Afraid of Overexposure Fighting Blocks Access to Ukraine Crash Site Dangerous Bacteria Kills One in Florida Workers Dig for Survivors After India Landslide Texas Scientists Study Ebola Virus Smartphone Powered Paper Plane Debuts at Airshow Southern Accent Reduction Class Cancelled in TN
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide